Question

What is the theory that government spending and tax cuts can raise demand called?

A. demand-side economics
B. atomic stabilizers
C. supply-side economics
D. multiplier effect

Answer 1

C. Supply-side economics

Answer 2

I believe the answer is: C. supply-side economics
In this theory, the government would made an effort to reduce the taxes imposed to the people and improve the amount of government spending to stimulate economic growth. This tactic is most commonly used when a country is facing an economic recession.